Enforcing a Judgment Against the Beneficiary of an Estate

Judgments entered against a decedent prior to death may and should be presented to the estate’s fiduciary for payment as debts of the estate, as set forth in Surrogate’s Court Procedure Act. See SCPA § 1803. But what if the judgment is against the beneficiary of an estate? The SCPA does not address that scenario.

Preliminarily, you need to confirm an estate has been opened and identify the fiduciary. You can obtain from the Surrogate’s Court a copy of the Will or the petition if the decedent died intestate, which would identify the beneficiaries. These records unfortunately are not available online, but you can search the Surrogate’s Court’s filings by the decedent’s name on the New York e-courts website to see if an estate has been opened. There also should be some information in the Surrogate’s Court filings about the decedent’s assets.

If you believe the judgment debtor is in-line to receive a significant bequest or intestate distribution, a judgment creditor can take action to make sure the funds or property come to you, not the judgment debtor. The appropriate procedure is to file a turnover order special proceeding pursuant to CPLR 5225/5227 in the Supreme Court against the estate fiduciary. See CPLR 5201(c)(2) (“Where property consists of a right or interest to or in a decedent’s estate or any other property or fund held or controlled by a fiduciary, the executor or trustee under the will, administrator or other fiduciary shall be the garnishee.”

CPLR 5225/5227 allow a judgment creditor to reach property of a judgment debtor in the possession or control of a third party (the garnishee) or debts owed to the judgment debtor by a garnishee. The judgment debtor is not a necessary party but must be sent notice of the proceeding, as provided in the statutes. It is advisable to invoke both sections when making an application for a “turnover” order. See D. Siegel & P. Connors, New York Practice § 510, at 894 (6th ed. 2018).

Once it is determined that a judgment debtor is owed a debt or a garnishee has possession or custody of personal property available to satisfy a judgment, the court must issue a turnover order under CPLR 5225(b); it is not a matter of discretion. See CPLR 5225(b) (“the court shall require the person to pay the money. . .”); 11 Weinstein-Korn-Miller, New York Civil Practice 5225.02, at 52-401. The same is true under CPLR 5227. Id. at 5227.13.

It does not matter that the debt owed is contingent or may not have vested. CPLR 5201(a) and (b) provide that a money judgment may be enforced against any debt or property which could be assigned or transferred, whether it consists of a present or future right or interest and whether or not it is vested, unless it is exempt from application to the satisfaction of the judgment. See ABKCO Indus. v. Apple Films, 39 N.Y.2d 670 (1976).

That the precise amount of the distribution the judgment debtor will or may receive from an estate has not yet to be determined also is not a basis to decline a turnover order sought by a judgment creditor. This is the teaching of the leading case, Streever v. Mazzone, 97 Misc. 2d 465 ( Sup. Ct. Saratoga County 1978). There, the court squarely posed the issue” “may this court issue a [turnover order] judgment so worded that it will not take effect until such time as it has been judicially determined by the Surrogate how much moneys and personal property the judgment debtor is entitled to as his one-half share of the residuary estate? After a lengthy analysis, the court answered its own question “Yes” and granted a turnover order directing the executors of an estate to pay the judgment creditor all monies which, at the time of the final accounting in Surrogate’s Court, the judgment debtor, a residuary beneficiary, was entitled to receive, even though the amount was not yet known.

With a turnover order against an estate fiduciary in place, a judgment creditor will ensure that funds from the estate are not paid to the judgment debtor, and he will secure his priority over any other competing judgment creditors.